Pelosi Call With Meadows Yields No Breakthrough on Stimulus

(Bloomberg) -- House Speaker Nancy Pelosi and White House Chief of Staff Mark Meadows talked for the first time in three weeks Thursday about the stalemate on a new pandemic relief bill without making any breakthrough to put negotiations back on track.

Pelosi said Democrats are continuing to insist on their demand that the White House and congressional Republicans double their offer on a stimulus package for an economy still reeling from high unemployment and business closures spurred by the pandemic.

“When they are ready to do that, we will be ready to negotiate and discuss the particulars,” Pelosi told reporters after her call with Meadows, which lasted about 25 minutes.

Pelosi said they’re “at a tragic impasse” because the administration won’t acknowledge the funding levels that experts and scientists know is needed. She said Democrats were now willing to reduce their initial $3.4 trillion proposal to $2.2 trillion, about $200 billion less than they had suggested earlier in the month. The Republicans have offered about $1 trillion in stimulus.

“We are still at a stumbling block,” she said at “For Our Future” virtual event, shortly after the call. “How they can nickel and dime the kids is something I find hard to understand.”

Meadows on Wednesday predicted that there would be no stimulus deal with House Democrats until the end of September, and said that it may be combined with a stopgap resolution needed to sustain funding of the federal government beyond Oct. 1, and avert a shutdown.

The phone conversation came after Meadows on Saturday tried to have an impromptu meeting with Pelosi while she was at the Capitol and went with his entourage to her suite, only to be told she was in a meeting.

Economic Warnings

Aid to state and local governments, the conditioning of school aid on fully re-opening classrooms, and the level of weekly unemployment insurance payments have been the biggest sticking points in the stalled talks. Democrats have been seeking $915 billion for regional authorities and a $600-per-week added unemployment benefit into 2021, significantly beyond what Republicans favor.

The White House has put $150 billion for states and localities on the table, and President Donald Trump on Aug. 8 signed an order creating a temporary $300-per-week benefit using limited disaster relief funds.

That temporary unemployment benefit, which hasn’t yet been distributed, is expected to run out in under five weeks once the program gets up and running.

The U.S. economy continues to suffer from the coronavirus slowdown. Initial jobless claims in regular state programs were 1.01 million in the week ended Aug. 22, the second straight week above 1 million, Labor Department data showed Thursday.

Fiscal Imperative

Federal Reserve Chair Jerome Powell warned the U.S. faces a “long tail” of relatively high unemployment as people struggle to find work in industries hit hard by the pandemic. “We need to stay with those people. We need to support them,” Powell said Thursday at a virtual iteration of the Kansas City Fed’s annual Jackson Hole conference.

Powell also called for more direct aid to small businesses, putting the onus on Congress to step up on fiscal policy.

Senate Republicans continue to refine a slimmed-down stimulus proposal with $300 per week in unemployment benefits but without the $1,200 direct stimulus payments for most people -- which both Trump and Pelosi have favored.

Discussions over the proposal aren’t expected to yield congressional floor action for weeks. The Senate isn’t scheduled to return to Washington until Sept. 8, with the full House returning for votes the following week.

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